The best approach to finding a new water heater for your home involves considering two main criteria: a heater that’s correctly sized to provide sufficient hot water, and one that makes good use of energy efficiency principles and technology. Beyond these points, choosing the right fuel source is also important, as well as the initial and ongoing costs for the new water heater. To help determine which of the many available types might be best suited for your home, a discussion of the various types of water heaters follows.

Conventional Water Heaters

These are still probably the most popular water heaters in use today, and they provide a reservoir of between 20 and 80 gallons of ready hot water to be used on demand. While it might be tempting to automatically install the tank with the largest reservoir, that may not be the most cost-efficient, since the reservoir water is being heated continuously. That means energy is being used continuously as well. A very large reservoir will probably also be more expensive than what’s actually needed for home use. Consider the true needs of the household for hot water, in addition to the cost of a fuel source and the costs associated with installation and maintenance.

Tankless Water Heaters

A tankless hot water heater is one that only provides hot water on demand, which means it is not constantly using energy to heat up the water in a reservoir. It also means that there is not as much ready hot water available for use as there might be from a conventional hot water heater. Under normal use, this has little impact on the home, except when multiple demands for hot water are made on the tankless heater simultaneously. However, this situation can be managed by installing multiple tankless heaters, such as using a separate one for a washing machine.

Heat Pump Water Heaters

Heat pumps are generally used as dual-purpose heating and cooling systems, depending on the season, but their versatility also allows them to be used as water heaters. They operate by extracting heat from the external air, warming it somewhat, and using that warm air to heat the water. Heat pump water heaters can be very efficient because of their efficient extraction of heat, but they are subject to the same limitations as when they’re used for regular heating of the home: they generally work best in climates that do not dip below about 40 degrees of outside air temperature.

Solar Water Heaters

Solar water heaters are one of the most cost-effective ways of heating water for your household since they make use of a free energy source for power. The drawbacks to installing solar heaters are their diminished efficiency in cloudy climates, and the fact that they generally require the installation of a backup source of hot water for sunless days and for days of increased demand.

Tankless Coil Water Heaters

A tankless coil system does not have a storage tank like a conventional water heater but instead supplies hot water on demand by heating cold water through a heating coil or heat exchanger, which is part of an existing furnace or heating system. This type of water heater is energy efficient since it runs only when hot water is demanded. But since it relies on the heating element from a furnace, it is not as responsive during the warm months when a heating system would be less active.